Question 1

The dictator of Turan has recently begun to arbitrarily seize farms belonging to his political opponents, and he has given the farms to his friends. His friends don't know much about farming. The courts in Turan have ruled that the seizures are illegal, but the dictator has ignored the rulings. Other things equal, we would expect that the growth rate in Turan will

Accepted Answer

A)  fall temporarily, but will return to where it was when the new owners learn how to farm.
B)  increase because the total amount of human capital in the country will increase as the new owners learn how to farm.
C)  fall and remain lower for a long time.
D)  not be affected unless widespread civil disorder or civil war results.E) A) and B)
F) A) and C)

Question 2

The traditional view of the production process is that capital is subject to

Accepted Answer

A)  constant returns.
B)  increasing returns.
C)  diminishing returns.
D)  diminishing returns for low levels of capital, and increasing returns for high levels of capital.E) B) and C)
F) A) and D)

Question 3

Which of the following public policies would be least likely to result in more rapid economic growth for a poor or developing country?

Accepted Answer

A)  policies designed to promote economic development in coastal areas
B)  policies designed to foster strict enforcement of property rights
C)  policies designed to foster free trade
D)  inward-oriented policiesE) B) and C)
F) All of the above

Question 4

In which of the following countries did real GDP per person fall by about 13% from 2000 to 2014?

Accepted Answer

A)  India
B)  Singapore
C)  Zimbabwe
D)  None of the above are correct.E) C) and D)
F) All of the above

Question 5

Suppose that an American opens and operates a candy factory in Finland. This is an example of

Accepted Answer

A)  foreign direct investment. American saving is used to finance Finish investment.
B)  foreign direct investment. American saving is used to finance American investment.
C)  foreign portfolio investment. American saving is used to finance Finish investment.
D)  foreign portfolio investment. American saving is used to finance American investment.E) B) and D)
F) None of the above

Question 6

Human capital is

Accepted Answer

A)  the same thing as technological knowledge.
B)  the same thing as labor.
C)  the tools and equipment operated by humans.
D)  knowledge and skills that workers have acquired.E) All of the above
F) A) and D)

Question 7

Country A and country B both increase their capital stock by one unit. Output in country A increases by 10 while output in country B increases by 8. Other things the same, diminishing returns implies that country A is

Accepted Answer

A)  richer than Country B. If Country A adds another unit of capital, output will increase by more than 10 units.
B)  richer than Country B. If Country A adds another unit of capital, output will increase by less than 10 units.
C)  poorer than Country B. If Country A adds another unit of capital, output will increase by more than 10 units.
D)  poorer than Country B. If Country A adds another unit of capital, output will increase by less than 10 units.E) A) and B)
F) C) and D)

Question 8

In which of the following countries has economic growth been sufficiently high that income would double every ten years?

Accepted Answer

A)  Singapore
B)  Nigeria
C)  India
D)  IndonesiaE) None of the above
F) A) and B)

Question 9

​Income rises after a charity gives poor families free livestock. The harvest that year was also particularly bountiful. The charity should take full credit for the observed increase in the standard of living.

Accepted Answer

A) True 
 B)False

Question 10

An economy's production function has the constant-returns-to-scale property. If the economy's labor force doubled and all other inputs stayed the same, then real GDP would

Accepted Answer

A)  stay the same.
B)  increase by exactly 50 percent.
C)  increase by exactly 100 percent.
D)  increase, but not necessarily by either 50 percent or 100 percent.E) B) and D)
F) All of the above

Question 11

In order to assess the level of prosperity in a nation in a given year, should we examine the level of that nation's real GDP per person, or should we examine the growth rate of that nation's real GDP per person?

Accepted Answer

The level of that na...

Question 12

Last year real GDP in the imaginary nation of Oceania was 561.0 billion and the population was 2.2 million. The year before, real GDP was 500.0 billion and the population was 2.0 million. What was the growth rate of real GDP per person during the year?

Accepted Answer

A)  12 percent
B)  10 percent
C)  4 percent
D)  2 percentE) A) and B)
F) A) and C)

Question 13

Which of the following can explain faster growth of real GDP in country A than in Country B?

Accepted Answer

A)  both greater population growth and greater productivity growth in Country A
B)  greater population growth in Country A, but not greater productivity growth in Country A
C)  greater productivity growth in Country A, but not greater population growth in Country A
D)  neither greater population growth nor greater productivity growth in Country AE) A) and D)
F) A) and C)

Question 14

Inventors often obtain patents on new products and processes, thereby turning new ideas into

Accepted Answer

A)  private goods and increasing the incentive to engage in research.
B)  private goods but decreasing the incentive to engage in research.
C)  public goods and increasing the incentive to engage in research.
D)  public goods but decreasing the incentive to engage in research.E) A) and D)
F) A) and C)

Question 15

A country experiencing a growth rate of 12% per year can go from being one of the poorest to one of the richest in how many generations?

Accepted Answer

A)  one
B)  two
C)  three
D)  fourE) A) and B)
F) A) and C)

Question 16

If a country's saving rate declined, then other things the same, in the long run the country would have

Accepted Answer

A)  lower productivity, but not lower real GDP per person.
B)  lower productivity and lower real GDP per person.
C)  lower real GDP per person, but not lower productivity
D)  neither lower productivity nor lower real GDP per person.E) A) and B)
F) C) and D)

Question 17

On a production function, as capital per worker increases, output per worker

Accepted Answer

A)  increases. This increase is larger at larger values of capital per worker.
B)  increases. This increase is smaller at larger values of capital per worker.
C)  decreases. This decrease is larger at larger value of capital per worker.
D)  decreases. This decrease is smaller at larger value of capital per worker.E) All of the above
F) None of the above

Question 18

Other things the same, a country that increases its saving rate increases

Accepted Answer

A)  its future productivity and future real GDP.
B)  neither its future productivity nor future real GDP.
C)  its future productivity, but not its future real GDP.
D)  its future real GDP, but not its future productivity.E) A) and B)
F) None of the above

Question 19

Studies have found that there is a relationship between height and productivity. Briefly explain.

Accepted Answer

Studies show that taller worke...

Question 20

Over the last 140 years or so, on average Canada's real GDP per-person grew faster than that of the U.K.

Accepted Answer

A) True 
 B)False

Exam 25: Production and Growth

Human capital is

Correct Answer
verified

Inventors often obtain patents on new products and processes, thereby turning new ideas into

Correct Answer
verified

Suppose that an American opens and operates a candy factory in Finland. This is an example of

Correct Answer
verified

Which of the following public policies would be least likely to result in more rapid economic growth for a poor or developing country?

Correct Answer
verified

Last year real GDP in the imaginary nation of Oceania was 561.0 billion and the population was 2.2 million. The year before, real GDP was 500.0 billion and the population was 2.0 million. What was the growth rate of real GDP per person during the year?

Correct Answer
verified

Correct Answer
verified

Studies have found that there is a relationship between height and productivity. Briefly explain.

Correct Answer
verified
Studies show that taller worke...
View Answer

On a production function, as capital per worker increases, output per worker

Correct Answer
verified

Other things the same, a country that increases its saving rate increases

Correct Answer
verified

An economy's production function has the constant-returns-to-scale property. If the economy's labor force doubled and all other inputs stayed the same, then real GDP would

Correct Answer
verified

Which of the following can explain faster growth of real GDP in country A than in Country B?

Correct Answer
verified

The traditional view of the production process is that capital is subject to

Correct Answer
verified

In order to assess the level of prosperity in a nation in a given year, should we examine the level of that nation's real GDP per person, or should we examine the growth rate of that nation's real GDP per person?

Correct Answer
verified
The level of that na...
View Answer

A country experiencing a growth rate of 12% per year can go from being one of the poorest to one of the richest in how many generations?

Correct Answer
verified

If a country's saving rate declined, then other things the same, in the long run the country would have

Correct Answer
verified

Over the last 140 years or so, on average Canada's real GDP per-person grew faster than that of the U.K.

Correct Answer
verified

Income rises after a charity gives poor families free livestock. The harvest that year was also particularly bountiful. The charity should take full credit for the observed increase in the standard of living.

Correct Answer
verified

Country A and country B both increase their capital stock by one unit. Output in country A increases by 10 while output in country B increases by 8. Other things the same, diminishing returns implies that country A is

Correct Answer
verified

In which of the following countries has economic growth been sufficiently high that income would double every ten years?

Correct Answer
verified

In which of the following countries did real GDP per person fall by about 13% from 2000 to 2014?

Correct Answer
verified

Exam 25: Production and Growth

Human capital is

Correct AnswerverifiedShow Answer

Inventors often obtain patents on new products and processes, thereby turning new ideas into

Correct AnswerverifiedShow Answer

Suppose that an American opens and operates a candy factory in Finland. This is an example of

Correct AnswerverifiedShow Answer

Which of the following public policies would be least likely to result in more rapid economic growth for a poor or developing country?

Correct AnswerverifiedShow Answer

Last year real GDP in the imaginary nation of Oceania was 561.0 billion and the population was 2.2 million. The year before, real GDP was 500.0 billion and the population was 2.0 million. What was the growth rate of real GDP per person during the year?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Studies have found that there is a relationship between height and productivity. Briefly explain.

Correct AnswerverifiedStudies show that taller worke...View AnswerShow Answer

On a production function, as capital per worker increases, output per worker

Correct AnswerverifiedShow Answer

Other things the same, a country that increases its saving rate increases

Correct AnswerverifiedShow Answer

An economy's production function has the constant-returns-to-scale property. If the economy's labor force doubled and all other inputs stayed the same, then real GDP would

Correct AnswerverifiedShow Answer

Which of the following can explain faster growth of real GDP in country A than in Country B?

Correct AnswerverifiedShow Answer

The traditional view of the production process is that capital is subject to

Correct AnswerverifiedShow Answer

In order to assess the level of prosperity in a nation in a given year, should we examine the level of that nation's real GDP per person, or should we examine the growth rate of that nation's real GDP per person?

Correct AnswerverifiedThe level of that na...View AnswerShow Answer

A country experiencing a growth rate of 12% per year can go from being one of the poorest to one of the richest in how many generations?

Correct AnswerverifiedShow Answer

If a country's saving rate declined, then other things the same, in the long run the country would have

Correct AnswerverifiedShow Answer

Over the last 140 years or so, on average Canada's real GDP per-person grew faster than that of the U.K.

Correct AnswerverifiedShow Answer

​Income rises after a charity gives poor families free livestock. The harvest that year was also particularly bountiful. The charity should take full credit for the observed increase in the standard of living.

Correct AnswerverifiedShow Answer

Country A and country B both increase their capital stock by one unit. Output in country A increases by 10 while output in country B increases by 8. Other things the same, diminishing returns implies that country A is

Correct AnswerverifiedShow Answer

In which of the following countries has economic growth been sufficiently high that income would double every ten years?

Correct AnswerverifiedShow Answer

In which of the following countries did real GDP per person fall by about 13% from 2000 to 2014?

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified
Studies show that taller worke...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The level of that na...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Income rises after a charity gives poor families free livestock. The harvest that year was also particularly bountiful. The charity should take full credit for the observed increase in the standard of living.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified